German-American Discourse on Politics and Culture

September 02, 2010

Review: The Nazi Dictatorship and the Deutsche Bank

Princeton historian Harold James' book The Nazi Dictatorship and the Deutsche Bank is a fascinating look a Germany's largest bank during the Third Reich but also a study of the role of private enterprise in a totalitarian command economy.

James starts with the early history of the bank and how it emerged from the collapse of the Weimar Republic as Germany's most important international financial institution. The rise of the Nazis posed a threat to Deutsche Bank, since the NSDAP was riding a wave of populism directed against the "Jewish" bankers who were supposedly behind the economic collapse. This suspicion of Finanzkapitalismus created tensions with the Nazi regime which would endure until 1945.

Beginning in 1934 the bank was forced to purge both its management and supervisory board of Jewish members. Shortly thereafter all Jewish employees were expelled from all the branches. Very quickly the bank became involved in the criminal activities of the Nazi regime, including taking over Jewish-owned merchant banks, appropriating bank accounts of Jewish customers, and, most importantly, managing the Aryanization of German industry - which was an especially lucrative business for Deutsche Bank.

What is fascinating is how the bank and its lawyers went to enormous lengths to put a legalistic veneer on this illegal theft of Jewish private property. Documents were carefully notarized and share certificates were painstakingly collected and recorded.

After the Anschluss of Austria and the invasion of Poland, Deutsche Bank's international contacts and experience were invaluable to the Nazi regime. Professor James spends quite a bit of time examining two transactions which were very important to Germany's "Drang nach Osten": the takeover of Creditanstalt in Vienna and the Union Bank of Bohemia (BUB) in Prague. The takeover of Jewish-owned BUB is especially instructive in terms of the Arayanization process. Both banks would be instrumental in expropriating and monetizing Jewish-owned assets as the German army moved through Eastern Europe.

In Poland, Deutsche Bank Katowice boasted of its loans to IG Farbenindustrie Werke Auschwitz which were used for constructing the largest site for murder in European history. Did the bank know about the true function of the camp? Herman Abs, the legendary banker, had responsibility for Katowice's business and also sat on the advisory board of IG Farben, and so must have been in a position to know.

Professor James describes the tension between the bank's senior management - who, for the most part, were not Nazi Party members - and the staff, many of whom were party activists and true believers in the "movement". Deutsche Bank was never as completely politicized as its rival Dresdner Bank - the Nazi Hausbank. Credit for this is due primarily to the efforts of two bankers - Hermann Abs and Emil Georg von Stauss. Von Stauss was politically astute and managed to insulate the bank as much as possible from the machinations of the Nazi regime until his death in 1942.

Hermann Abs is much more elusive figure. He seems to have had protectors high up in the Nazi hierarchy but also flirted with the Catholic resistance. In the end, he refused to play a role in the July 20 plot against Hitler. Hero? Scoundrel? Hard to say. But in any case, a brilliant banker who went on to restore the German banking system after the war and helped finance the Wirtschaftswunder - Germany's economic miracle.

Before we condemn Deutsche Bank too harshly as an enabler of the Third Reich it is important to understand the environment in which the bank was operating. Professor James provides two chilling examples that illustrate the risks. In 1943 a director of the Hindenburg branch (Upper Silesia) was executed by Nazi regime after a disgruntled secretary denounced him for making derogatory comments about Hitler. A few weeks later in that year, Hermann Koehler, the director of the Stuttgart branch, was guillotined at Brandenburg prison. His crime? He was overheard on a train saying that "National Socialism was nothing more than a fart."

Comments

Thanks for that.
A great example of how institutions & their professional workers maintain their particular functions a virtues even unto the desrruction of everything else around them. Likewise the legal, medical, scientific, the church , and, of course the military. There's something about what one writer called "assignable expertise"or the "politics of not being political" that causes highly trained people to fail to ask basic ethical quesions about the wider implications of their work, How absurd, for example, for a bridge engineer to questions IF a bridge should be built.

Christine Müller, my professor at Reed College from whom I took history courses about Weimar and the Third Reich, said that the ability of Germans to stay organized, uphold instituitons, and carry out projects in even the most abnormal circumstances caused a lot of the damage at that time. You could say that the trains carrying the Jews to Ausschwitz always arrived on time.

Christine, this is an interesting point. I think there is a German trait which you can find in all countries which once belonged to Germany too:

Under extreme pressure in times of a crisis, many people fall back to standard routines and sets of rules. They make an art out of carrying them out, which allows them to move their entire focus on this activity and remain relatively calm while others would be driven mad by the circumstances.